On Tower UK Limited v J.H. Green Limited

When replacing an existing electronic communications code agreement under Part 5 of the Code, the tribunal must consider the existing terms alongside the statutory requirements, the operator’s needs, the site provider’s use of the land, the public interest and all other relevant circumstances. Existing terms are not an overarching restriction on change, particularly where they pre-date the Code or conflict with its purposes.

Paragraph 17 provides a starting point and minimum automatic protections for upgrading and sharing. An operator seeking wider rights must explain why they are needed, but need not establish exceptional or compelling circumstances. Future technological uncertainty may support flexible rights. Public benefit, business needs, planning controls, contractual safeguards and compensation may justify unrestricted upgrading and sharing.

On Tower UK Limited occupied a telecommunications site on land owned by J.H. & F.W. Green Limited under a 1999 lease. The lease continued under the electronic communications code after its contractual expiry.

On Tower applied to the Upper Tribunal (Lands Chamber) under Part 5 of the Code for the lease to be terminated and replaced by a new agreement. The parties agreed many terms but disputed the scope of rights to install, upgrade and share electronic communications apparatus.

The Upper Tribunal granted On Tower unrestricted upgrading and sharing rights in its decision at [2020] UKUT 348 (LC). The appeal concerned whether the Tribunal had applied the correct statutory framework, the significance of the existing lease under paragraph 34(12), and whether paragraph 17 supplied a ceiling or merely a starting point.

Appeal dismissed.

1. On a Part 5 application to terminate an existing code agreement and impose a replacement agreement, the Tribunal must specify the terms under paragraph 34(10), applying the provisions identified in paragraph 34(11). It must have regard to the existing agreement under paragraph 34(12) and to all the circumstances, including the operator’s business and technical needs and the site provider’s use of the land under paragraph 34(13).
2. Paragraph 34(12) does not impose an overarching restriction on changing existing terms. Although the language resembles section 35 of the Landlord and Tenant Act 1954, that Act and the Code have different purposes. Existing terms remain relevant. Where a party seeks to retain a term, the party proposing a change bears an onus of justification. The weight given to the existing term depends on its consistency with the purposes of the Code. A pre-Code agreement is less likely to reflect those purposes.
3. Paragraph 17 supplies a starting point and the minimum automatic upgrading and sharing rights. An operator seeking wider rights must explain why they are required, but need not establish “pretty striking” or “pretty compelling” circumstances. The application must be assessed on its individual merits and wider rights are not inherently improbable.
4. The Tribunal was entitled to grant unrestricted rights. On Tower’s status as a neutral infrastructure host, the public benefit of sharing, the need to accommodate uncertain technological development and the practical burden of renegotiating future rights justified the terms sought. The site provider’s concerns were capable of protection through the agreement, planning controls, the National Park regime and compensation.
5. The Tribunal’s mistaken treatment of the application as one under Part 4, and its reference to paragraph 21, did not justify interference with the result. It had nevertheless exercised a discretion, considered the parties’ competing needs and addressed the matters of real significance under Part 5.

• Court of Appeal (Civil Division): dismissed the appeal and upheld the replacement agreement granting unrestricted upgrading and sharing rights.
• Upper Tribunal (Lands Chamber): in [2020] UKUT 348 (LC), ordered termination of the existing lease and imposed a new agreement containing the disputed rights.